Master of Business Administration- MBA Semester 1 Reg No.

: 511011932

MB0040 – Statistics for Management - 4 Credits

Assignment Set- 1 (60 Marks)

Q1. Elucidate the functions of statistics.

Functions or Uses of Statistics
(1) Statistics helps in providing a better understanding and exact description of a
phenomenon of nature.
(2) Statistical helps in proper and efficient planning of a statistical inquiry in any field of
study.
(3) Statistical helps in collecting an appropriate quantitative data.
(4) Statistics helps in presenting complex data in a suitable tabular, diagrammatic and
graphic form for an easy and clear comprehension of the data.
(5) Statistics helps in understanding the nature and pattern of variability of a
phenomenon through quantitative observations.
(6) Statistics helps in drawing valid inference, along with a measure of their reliability
about the population parameters from the sample data.

Q2. What are the methods of statistical survey? Explain briefly.

Statistical surveys are used to collect quantitative information about items in a
population. Surveys of human populations and institutions are common in political polling
and government, health, social science and marketing research. A survey may focus on
opinions or factual information depending on its purpose, and many surveys involve
administering questions to individuals. When the questions are administered by a
researcher, the survey is called a structured interview or a researcher-administered
survey. When the questions are administered by the respondent, the survey is referred
to as a questionnaire or a self-administered survey. Methods used to increase response
rates
brevity - single page if possible
financial incentives
paid in advance
paid at completion
non-monetary incentives
commodity giveaways (pens, notepads)

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Master of Business Administration- MBA Semester 1 Reg No.: 511011932

entry into a lottery, draw or contest

discount coupons
promise of contribution to charity
preliminary notification
foot-in-the-door techniques - start with a small inconsequential request
personalization of the request - address specific individuals
follow-up requests - multiple requests
claimed affiliation with universities, research institutions, or charities
emotional appeals
bids for sympathy
convince respondent that they can make a difference
guarantee anonymity
legal compulsion (certain government-run surveys)

Sampling
Main article: Sampling (statistics)
Sample selection is critical to the validity of the information that represents the
populations that are being studied. The approach of the sampling helps to determine the
focus of the study and allows better acceptance of the generalizations that are being
made. Careful use of biased sampling can be used if it is justified and as long as it is
noted that the resulting sample may not be a true representation of the population of the
study. There are two different approaches to sampling in survey research:
There is nonprobability sampling approach. In this approach the researcher does not
know each element's probability of selection in the sample. The most commonly used
nonprobability sampling method is the convenience sampling approach. With this
method, it only samples those who are available and willing to participate in the survey.
The use of this approach allows for convenience for the researcher while possibly losing
data validity due to the lack of representation.
The probability sampling approach for research methods gives each element a known
chance of being included in the sample. This method is closer to a true representation of
the population. It can be difficult to use due to cost of a rigorous sampling method, and
difficulty in obtaining full coverage of the target population, but the generalizations that
come from it are more likely to be closer to a true representation of the population.
Different forms of probability sampling are designed to achieve various benefits - e.g.

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Master of Business Administration- MBA Semester 1 Reg No.: 511011932

theoretical simplicity, operational simplicity, detailed information on subpopulations, or

minimal cost. Some common forms:

Equal probability of selection designs (EPS), in which each element of the population
has an equal chance of being included in the sample. This uniformity makes EPS
surveys relatively simple to interpret. Forms of EPS include Simple random sampling
(SRS) and systematic sampling.
Probability-proportional-to-size designs (PPS), in which 'larger' elements (according to
some known measure of size) have a higher chance of selection. This approach is
common in business surveys where the object is to determine sector totals (e.g. "total
employment in manufacturing sectors"); compared to EPS, concentrating on larger
elements may produce better accuracy for the same cost/sample size.
Stratified random sampling approach, in which the population is divided into
subpopulations (called strata) and random samples are then drawn separately from each
of these strata, using any probability sampling method (sometimes including further sub-
stratification). This may be done to provide better control over the sample size (and
hence, accuracy) within each subpopulation; when the variable/s of interest are
correlated with subpopulation, it can also improve overall accuracy. Another use for
stratification is when different subpopulations require different sampling methods - for
instance, a business survey might use EPS for businesses whose 'size' is not known
and PPS elsewhere.

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Master of Business Administration- MBA Semester 1 Reg No.: 511011932

Q3.Tabulate the following data:

Age: 20-40; 40-60;60-above
Departments: English, Hindi, Political science, History, sociology
Degree level: Graduates, Post graduates; PhD,
Total students in age group and in degree level.

AGE DEPARTMENT DEGREE

E, H, P, S, H, Socially Graduates/Post
20-40 English, History Graduate/PHD
By Post Graduate
40-60 All the student Great with PhD
60-above Compulsory With the Degree

A statistical table is a systematic organization of data in Row & Column. According to

prefers Connor tabulation involves an orderly & systematic presentation of numerical
data in a form design to complain the problem under consideration.
(i) table No:- Ist of all a table must be numbered different tables must have different no.
numbers help location of the table.
(ii) Titles:- A table must have a title, title must be written in board latters.
(iii) Head notes:- If the title of table does not give complete information. Its sample
mented with the head notes.
(iv) Stubs:- stubs are titles of the Row’s of the table
(v) Caption:- Caption is the title given to the column’s of the table.

Q4. The data given below is the distribution of employees of a business according
to their efficiency. Find the mean deviation and coefficient of mean deviation from
Mean and Median:
Efficiency Index 22-26 26-30 30-34 34-38 38-42
Emloyees 25 35 15 5 2

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Master of Business Administration- MBA Semester 1 Reg No.: 511011932

Efficiency Employees x fx x− x f x− x ( x − median) F(x-

Index F median)
22-26 25 24 600 -4.29 107.25 8 200
26-30 35 28 980 -.29 10.15 4 140
30-34 15 32 480 3.71 55.65 0 0
34-38 5 36 180 7.71 38.55 4 20
38-42 2 40 80 11.71 23.42 8 16
82 2320 235.02 24 376

∑ fx 2320
mean = x = = = 28.29
∑f 82

∑ x−x 2.87
md from Mean = = = 0.1014
n 28.29
= 0.10

∑( x − median) 376
md from median = [ ]= =11.75
median 32
md from median 11.75
coff of md (median) = = = 0.367
median 32

Q5. What is conditional probability? Explain with an example.

Conditional probability is the probability of some event A, given the occurrence of some
other event B. Conditional probability is written P(A|B), and is read "the (conditional)
probability of A, given B" or "the probability of A under the condition B". When in a
random experiment the event B is known to have occurred, the possible outcomes of the
experiment are reduced to B, and hence the probability of the occurrence of A is
changed from the unconditional probability into the conditional probability given B.
Joint probability is the probability of two events in conjunction. That is, it is the probability
of both events together. The joint probability of A and B is written or
Marginal probability is then the unconditional probability P(A) of the event A; that is, the
probability of A, regardless of whether event B did or did not occur. If B can be thought
of as the event of a random variable X having a given outcome, the marginal probability
of A can be obtained by summing (or integrating, more generally) the joint probabilities
over all outcomes for X. For example, if there are two possible outcomes for X with

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Master of Business Administration- MBA Semester 1 Reg No.: 511011932

corresponding events B and B', this means that . This is called marginalization.
In these definitions, note that there need not be a causal or temporal relation between A
and B. A may precede B or vice versa or they may happen at the same time. A may
cause B or vice versa or they may have no causal relation at all. Notice,

Q6.The probability that a football player will play Eden garden is 0.6 and on
Ambedkar Stadium is 0.4. The probability that he will get knee injury when playing
in Eden is 0.07 and that in Ambedkar stadium is 0.04.What is the probability that
he would get a knee injury if he played in Eden.

1
P(E1 ) = P (E 2 ) =
2

P (E1) = 0.6 P(E2) = 0.4

A be the engree (AE1) = 0.07

P (A / E2) = -
1
× 0.4
P(A/E 2 )2 = 2
1 1
× 0.6 + × 0.7
2 2
= 0.3

MB0040 – Statistics for Management - 4 Credits

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Master of Business Administration- MBA Semester 1 Reg No.: 511011932

Assignment Set- 2 (60 Marks)

Q1. A random sample of 6 sachets of mustard oil was examined and two were
found to be leaking. A wholesaler receives seven hundred twenty six packs, each
containing 6 sachets. Find the expected number of packets to contain exactly one
sachet leaking?
Sol.
N=6
P=2
H=4
Total no, of outones = 726
P (x =1) ⇒c (n1r) Pr q n-r
C (6, 1) P1 q5

⇒ 6 x 726 x 1
= 4356

Q2. What do you mean by errors in statistics? Mention the measures to do so.
The standard error of a method of measurement or estimation is the standard deviation
of the sampling distribution associated with the estimation method. The term may also
be used to refer to an estimate of that standard deviation, derived from a particular
sample used to compute the estimate.
For example, the sample mean is the usual estimator of a population mean. However,
different samples drawn from that same population would in general have different
values of the sample mean. The standard error of the mean (i.e., of using the sample
mean as a method of estimating the population mean) is the standard deviation of those
sample means over all possible samples (of a given size) drawn from the population.
Secondly, the standard error of the mean can refer to an estimate of that standard
deviation, computed from the sample of data being analysed at the time.
The term standard error is derived[citation needed] from the fact that, as long as the
estimator is unbiased, the standard deviation of the error (the difference between the
estimate and the true value) is the same as the standard deviation of the estimates
themselves; this is true since the standard deviation of the difference between the
random variable and its expected value is equal to the standard deviation of a random
variable itself.
In many practical applications, the true value of the standard deviation is usually

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Master of Business Administration- MBA Semester 1 Reg No.: 511011932

unknown. As a result, the term standard error is often used to refer to an estimate of this
unknown quantity. In such cases it is important to be clear about what has been done
and to attempt to take proper account of the fact that the standard error is only an
estimate. Unfortunately, this is not often possible and it may then be better to use an
approach that avoids using a standard error, for example by using maximum likelihood
or a more formal approach to deriving confidence intervals. One well-known case where
a proper allowance can be made arises where the Student's t-distribution is used to
provide a confidence interval for an estimated mean or difference of means. In other
cases, the standard error may usefully be used to provide an indication of the size of the
uncertainty, but its formal or semi-formal use to provide confidence intervals or tests
should be avoided unless the sample size is at least moderately large. Here "large
enough" would depend on the particular quantities being analysed.

Q3. From a population known to have a standard deviation of 1.4, a sample of 70

individuals is taken. The mean of this sample is found to be 6.2. Find the standard
error of the mean. Also establish an interval estimate around the sample mean
using one standard deviation of the mean.
Sol.
Standard error of mean
(i) When standard deviation of the population is know
σP
S.E. x =
N
S.E. x refers to the standard error of the mean

σ p standard deviation of the the population

N = number of observation
1.4
x=
6.2
1.4
=
2.48

⇒ 0.5645

σ sample
S .E.x =
N

70
⇒
6.2

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70
= =28.22
2.48

Q4. A machine is designed so as to pack 300ml of a solution with a standard

deviation of 5ml. A sample of 150 bottles when measured had a mean content of
201.3ml. Test whether the machine is functioning properly.(use 5% level of
significance)

1 1 
S .E.( P1 − P2 ) = pq  + 
 n1 n 2 

1200
P1 = = 0.6
2000

800
P2 = = 0.8
1000

x1 + x2 1200 + 800
P= = = 0.6666
n1 + n 2 2000 + 1000

q = 1 − p ⇒ 0.334
S .E( p1 − p2 ) = = 3.33 =1.824
 1 1 
0.666 × 0.334  + 
 2000 1000 

Q5. Out of 2000 people surveyed, 1200 belong to urban areas and rest to semi
urban areas. Among 1000 who visited other regions, 800 belonged to urban areas.
Test at 5% level of significance whether area and visiting other states are
dependant.

x1 − x 2 n1 n2
Ε=
5 n1 + n2
x1 = 300, S1 = 5, n1 = 5
x2 =150, S2 = 201.3, n2 = 201.3

s2
4( s ) 2 + 200.3(201.3)2
5 + 201.3 − 2

⇒ 199.31

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Master of Business Administration- MBA Semester 1 Reg No.: 511011932

300 −150 5 × 201.3

Ε= ×
199.31 5 + 201.3
1006.5
0.752 ×
206.3

⇒ 1.6551

Q6. How is statistics useful for modern managers? Give examples and explain.
Managers need an understanding of statistics for four key reasons: to know how to
properly present and describe information; to know how to draw conclusions about large
populations based only on information obtained from samples; to know how to obtain
reliable forecasts and to know how to improve processes . These four reasons form the
basis of the structure and content of Statistics for Managers. There is not a single activity
undertaken in business or in everyday life that does not involve probability. In many
cases the probabilities are consciously considered while in others they may be
subconscious. Ordering a particular level of stock for a retail outlet involves a probability
consideration of the actual demand for the products. Undertaking tertiary studies
involves probability estimations for levels of future income that a degree will produce. In
the same way, almost all business decisions depend on probability evaluation. It is
important then for you to have an understanding of probability analysis.
Having developed our basic ‘feel’ for probabilities we need to develop an understanding
of the key theoretical probability distributions. These enable us to assign probabilities of
all potential outcomes for a given situation. This work will enable us to move onto the
very important statistical concept called the sampling distribution. Many data sets for the
business manager are samples drawn from a wider population. Of interest to the
manager are the conclusions that can be drawn about the relevant population
characteristic from the sample statistic. We might have some market research that
indicates that customer acceptance of a new brand is 30%. The obvious conclusion is
that 30% of all potential customers will accept the brand. However, if the sample is not
representative of the population then the results may be misleading. Even when the
sample is representative, intuitively we would not believe that exactly the same result
would hold for the population. We need to understand how samples are taken from
population and what affect this has on sample statistics such as the sample mean,
sample proportion etc. We will examine sampling theory and the resulting sampling

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distributions. These are probability distributions for sampling situations.

The idea of sampling in business situations and inferential statistics as a method for
drawing conclusions about population parameters from sample statistics are both
fundamental issues in statistics. The problem with a sample, however, is error. A sample
is unlikely to be an accurate representation of the whole population but the concept of
the confidence interval can be used to cope with sample error.
1. The six sigma is the best way in managing the business which puts all the data and
while using the data and facts in order to have a better solution. This can also be use for
the improvement of the customer satisfaction, to reduce the time of the cycle, and can
also reduce the defects.
a). The control chart for the product and service of Brecker Associates, Inc. First Phase
Quantifying Opportunities
Second Phase
Planning Solutions
Third Phase
Re-designing
Process
Fourth Phase
Implementing Change
Performance Data Planning Solutions
b.) The techniques in valuing are the ways that the business is using for the productivity
of the business and the process, the cost and the quality. This includes the company’s
workshop on design, marketing, quality, operations, purchasing and the personnel
supplier. In this manner, the first phase is the quantification of the opportunities of
Brecker Associates Inc. which use for the quantification and determination of the
services and products that the company is producing. For the planning solution which is
the second phase is the move or the way that the company had been notified in order to
get solutions for the circumstances in the company. The designing again of the plan is
also applicable as for the improvement of the company’s services and products. The
implementation of the change is applicable after the exact analyzation and detailed
outcome of the plan. With the aide of the QFD technique, the requirements for the
customer can be determined and can also be quantified. This way, the benefits
regarding the improvements had been sought and identified and are being refined for the
improvement of the services. These can also lead to the redesign of the products which

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was the company’s phase 3. The redesigned of the specified components or the
processes are charged and made an additional tools and quality that had been used for
the design in the manufacture, in lean thinking, the design of the assembly, and the
reduction set-up. These phases are all dependent on the data planning solutions
performance.
The processes are in control of the team which only signifies that the results are all at
the hands of the team.
c). The recommended policy is to have a keen understanding of the team towards the
required factors which can improve the performance of the products and services as
benefitted to the employees and to the company.
7. The scatter diagram of the given data is given below. Based on the graph, the data
are interrelated to one another which only show that the weight of the mails has high
correlation to the number of orders. Computing the relationship of the mails’ weight and
the number of orders it will get the value of the Pearson r or the correlation coefficient to
be 0.99 and interpreted as high correlation.
a). Using the least-square method the regression line had been notified and
approximately as y = 5.55 + 32.76x. This means that the slope is 32.76 with the vertical
intercept to be 5.55.
b). This means that whatever the value to be substituted in x will always depend on the
slope and to the vertical intercept so that it can get the value of y or the weight of the
mails.
c). Using the regression line, substitute the value of weight of the mails in y or 500
pounds. The value of x got is 15.0931 or $15,093.10.
d). The prediction is reliable because it use the regression line and the value that had
got is near to the least square regression line.

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